Forex Market witnessed a surge in turnover, totaling $53.02 million, following the Central Bank of Nigeria’s decision to lift the ban on 43 items.
The CBN had on Thursday announced the lifting of restrictions on forex for import of 43 items through its official window.
Join our WhatsApp ChannelIn a statement titled ‘CBN restates commitment to boost liquidity in forex market,’ Isa AbdulMumin, Director of Corporate Communications, stated, “Importers of all the 43 items previously restricted by the 2015 circular are now allowed to purchase foreign exchange in the Nigerian foreign exchange market.”
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The effects of this decision were immediately evident, with the Investor & Exporter (I&E) forex window witnessing a turnover of $53.02 million on Friday. Although the official trading platform recorded a lower turnover compared to Tuesday, the move symbolized a shift in forex dynamics. The naira also saw a modest appreciation, exchanging at 764.86/$, down from 766.70/$ on Thursday.
According to a report by Punch, Financial analysts from Cordros Securities commented on this development, saying, “While this is another step forward, we think FX liquidity should take prominence to avoid further FX pressures at the official and parallel markets. Perhaps this is a signaling tool by the CBN to shift attention away from the parallel market and reduce the pressure of the official market playing a catch-up game with the unofficial exchange rate. Hence, in terms of impact, we think FX pressures will increase in the official market in the near term, while the parallel market rate is likely to appreciate as the importers of these 43 items move to the official market.”
This pivotal decision by the CBN is expected to reshape the dynamics of the Nigerian forex market and could bring about significant changes in the near future.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
